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> It’s not necessarily the case that greedy, ignorant MBAs came in and ruined everything. Like, if their practices were so inferior, then any domestic firm that

by bsder 3y ago

> It’s not necessarily the case that greedy, ignorant MBAs came in and ruined everything. Like, if their practices were so inferior, then any domestic firm that didn’t get taken over by them should’ve had a leg up and could’ve dominated the domestic market. In this instance, it was people like Icahn. Machine tools were a very cyclical market. Consequently, they did well as part of a vertically integrated conglomerate where the profits could be booked over time and the R&D could be shared with the manufacturing parent. When forced to spin out and stand alone by corporate raiders, those companies were effectively doomed as you just ripped out their ability to do R&D. In addition, people forget that the Japanese companies were very much not playing fair. MITI (Ministry of International Trade and Industry) and the keiretsu/zaibatsu companies were actively attacking the US companies--this was effectively governmental and monopoly collusion. This attack was to the point that they almost wiped out the semiconductor industry (which prompted the DARPA VHSIC project and later Sematech in response) for example. They did similar actions in the manufacturing industries but the government never responded with the same vigor. > Was the policy to outsource everything, or liberalize markets and let firms and consumers more freely choose where to buy things from? The policy was to fund the hell out of West Coast (high tech and mostly no unions) and to leave the Rust Belt (manufacturing and lots of unions) to rot. I will be one of the first to line up to piss on Reagan's grave for the complete shit that he was. However, to be fair, NOBODY had any answer to the fact that manufacturing automated and could get by on two orders of magnitude fewer employees. Every country dependent upon manufacturing went through a horrible time (see: England and Thatcher for similar vitriol). In fact, nobody still has any answer 4 decades+ later. It's one of the reasons there are so many old, very angry MAGAs. > Globalization has done quite a lot to lift people out of poverty and keep prices low. At what local cost? Nobody in Cleveland gives a shit about whether someone in Africa is doing better when they can't make their house payment.

CPLX 3y ago
There's no such thing as playing fair it's just national industrial policy. Every country has one. The change was that ours went from "try to have industry in this country" to "my friends make money offshoring stuff" instead.
glompers 3y ago
Great points. Riffing on your last remark, the federal labor statistics list of Ohio occupations with the highest location quotients (prevalence in that area divided by prevalence of the same occupation nationwide) still shows machine tools related professions near the top. Surely that cluster of expertise would be in even greater demand if the national economy were to grow in that direction. May 2022 Engine and Other Machine Assemblers 4.21 Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic 3.79 Patternmakers, Metal and Plastic 3.23 Forging Machine Setters, Operators, and Tenders, Metal and Plastic 2.99 Heat Treating Equipment Setters, Operators, and Tenders, Metal and Plastic 2.91 Tool and Die Makers 2.81 Grinding, Lapping, Polishing, and Buffing Machine Tool Setters, Operators, and Tenders, Metal and Plastic 2.75 Sewers, Hand 2.71 Cutting, Punching, and Press Machine Setters, Operators, and Tenders, Metal and Plastic 2.70 Model Makers, Metal and Plastic 2.64
AnthonyMouse 3y ago
> When forced to spin out and stand alone by corporate raiders, those companies were effectively doomed as you just ripped out their ability to do R&D. It would be just as fair to blame the original culture of having vertically integrated conglomerates to begin with. If there is anyone who should be able to figure out how to automate manufacturing with a small number of workers, it should be a bunch of machinists. But you put them in a lumbering conglomerate and teach them that automation is the enemy because it will take their jobs. Then they take that same attitude into a smaller company that has to be leaner in order to survive and you've set them up for failure. Whereas if you embrace it, instead of domestic buyers getting their goods from cheap labor in China, domestic and international buyers get their goods from automated domestic factories that employ fewer people per unit but make more units than ever before because they have globally competitive prices and the global demand when you can supply at a low price is enormous. > Nobody in Cleveland gives a shit about whether someone in Africa is doing better when they can't make their house payment. But the reason they can't make their house payment is the same kind of regulatory capture that they supported and caused them to lose their job, which in turn makes housing unaffordable because you can't outsource plumbers and electricians.
- maxglute 3y ago
  > you can't outsource plumbers and electricians Not yet. Wonder where west would be if politics threw trades to the wolves and kept machinists. Maintain manufacturing prowess and build cheap factories.
  - hasty_pudding 3y ago
    who needs to outsource when you can just open the borders.
- sokoloff 3y ago
  > you can't outsource plumbers and electricians You can outsource trades (that's literally what almost every general contractor builder does->outsource specialist trades to subcontractors). You can't off-shore them (or at least not nearly so easily and completely).
com2kid 3y ago
> However, to be fair, NOBODY had any answer to the fact that manufacturing automated and could get by on two orders of magnitude fewer employees. Hasn't the answer been tons more products being made? More product designers, more tool manufacturers, more people in charge of designing factories, more automation engineers, more robotics engineers? More people supporting those products, more people in sales, more people doing packaging design, logo design, and so on and so forth. (None of this is environmentally sustainable, separate discussion!)

by bsder 3y ago

CPLX 3y ago

There's no such thing as playing fair it's just national industrial policy. Every country has one. The change was that ours went from "try to have industry in this country" to "my friends make money offshoring stuff" instead.

glompers 3y ago

Great points. Riffing on your last remark, the federal labor statistics list of Ohio occupations with the highest location quotients (prevalence in that area divided by prevalence of the same occupation nationwide) still shows machine tools related professions near the top. Surely that cluster of expertise would be in even greater demand if the national economy were to grow in that direction. May 2022 Engine and Other Machine Assemblers 4.21 Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic 3.79 Patternmakers, Metal and Plastic 3.23 Forging Machine Setters, Operators, and Tenders, Metal and Plastic 2.99 Heat Treating Equipment Setters, Operators, and Tenders, Metal and Plastic 2.91 Tool and Die Makers 2.81 Grinding, Lapping, Polishing, and Buffing Machine Tool Setters, Operators, and Tenders, Metal and Plastic 2.75 Sewers, Hand 2.71 Cutting, Punching, and Press Machine Setters, Operators, and Tenders, Metal and Plastic 2.70 Model Makers, Metal and Plastic 2.64

AnthonyMouse 3y ago

> When forced to spin out and stand alone by corporate raiders, those companies were effectively doomed as you just ripped out their ability to do R&D. It would be just as fair to blame the original culture of having vertically integrated conglomerates to begin with. If there is anyone who should be able to figure out how to automate manufacturing with a small number of workers, it should be a bunch of machinists. But you put them in a lumbering conglomerate and teach them that automation is the enemy because it will take their jobs. Then they take that same attitude into a smaller company that has to be leaner in order to survive and you've set them up for failure. Whereas if you embrace it, instead of domestic buyers getting their goods from cheap labor in China, domestic and international buyers get their goods from automated domestic factories that employ fewer people per unit but make more units than ever before because they have globally competitive prices and the global demand when you can supply at a low price is enormous. > Nobody in Cleveland gives a shit about whether someone in Africa is doing better when they can't make their house payment. But the reason they can't make their house payment is the same kind of regulatory capture that they supported and caused them to lose their job, which in turn makes housing unaffordable because you can't outsource plumbers and electricians.

maxglute 3y ago
> you can't outsource plumbers and electricians Not yet. Wonder where west would be if politics threw trades to the wolves and kept machinists. Maintain manufacturing prowess and build cheap factories.
- hasty_pudding 3y ago
  who needs to outsource when you can just open the borders.
sokoloff 3y ago
> you can't outsource plumbers and electricians You can outsource trades (that's literally what almost every general contractor builder does->outsource specialist trades to subcontractors). You can't off-shore them (or at least not nearly so easily and completely).

com2kid 3y ago

> However, to be fair, NOBODY had any answer to the fact that manufacturing automated and could get by on two orders of magnitude fewer employees. Hasn't the answer been tons more products being made? More product designers, more tool manufacturers, more people in charge of designing factories, more automation engineers, more robotics engineers? More people supporting those products, more people in sales, more people doing packaging design, logo design, and so on and so forth. (None of this is environmentally sustainable, separate discussion!)